Bandar Malaysia – a city of two tales
18 Sep 2020
Bandar Malaysia, slated to be a hub for global multinationals and Fortune 500 companies, has the opportunity to become a game-changer for foreign investors into Malaysia but there will be hurdles in achieving that.
While the timing and the infrastructure may be just right, there are also fears that it may be “more of the same”.
The timing of the development is just right and could capitalise on the next upward cycle of the local property market, PPC International managing director Datuk Siders Sittampalam said.
“Bandar Malaysia is going to be built as a digital city, catering to high-end users with excellent infrastructure. China being involved is also a plus point in attracting foreign investors, ” he told StarBiz.
“With the various rail lines running through it, Bandar Malaysia is also set to become a transport hub. I believe the timing will be just right, when everything is up and running.”
CBRE|WTW group deputy managing director Danny Yeo (pic below) is optimistic that the Bandar Malaysia development has the capacity to create new demand for high-end space.
“If they can achieve what they say they are targeting, then yes, Bandar Malaysia can attract foreign investments into the country. This will create a spillover effect for local buyers and even help create job opportunities.”
With the latest technology being brought into the country, Yeo said, there would be a need for skilled workers to manage that technology.
“This will create a need to bring in high-skilled labour into the country, which will result in the transfer of knowledge to our local workforce. So, in the long run, it can benefit Malaysia.”
However, Yeo said, Bandar Malaysia would need to introduce new, revolutionary concepts to be able to be considered attractive to investors.
“If you’re just developing the same old thing, then it will be hard to be successful. What you are introducing needs to be a game-changer to the industry.”
The promoters of Bandar Malaysia hope the influx of expatriates would create a wave of demand for housing throughout greater Klang Valley.
One industry observer, who requested anonymity, however said he is less-than-optimistic about the prospects for Bandar Malaysia.
“We are already facing an oversupply of high-rise units in the country. Will developing more of such units benefit the local property market?”
In light of the current global economic situation, he said now is not a good time to develop a high-scale project.
“There is still too much uncertainty. Build when the economy is steadily growing or when there is better political stability in the country. Only then will foreign investors find you attractive and appealing.”
Another industry observer concurred that it was not a good time now to dive into a large scale property project, due to the impact the Covid-19 pandemic has had on businesses globally.
“I believe that even when the pandemic is over or if we finally have a vaccine, people will still remain cautious.
“When the pandemic hit, many people with foreign investments got stuck because they couldn’t travel or visit or have better control over their businesses.”
Post-Covid, he believes many investors will be inclined to invest in their own economies.
“Yes, there will be foreign investments but it needs to be incredibly attractive. Only then will people consider.
“I believe it is better to invest in what the rakyat wants, and that is more affordable homes. You don’t need a foreign developer for that… only a good local one.”
Located at the site of the Royal Malaysian Air Force base in Jalan Sungai Besi, Bandar Malaysia will be a mixed-use, transit-oriented development with a gross development value of RM140bil.
With a land area of 194.5ha, it is the single largest piece of development land in the heart of Kuala Lumpur. The Bandar Malaysia project was reinstated by the Pakatan Harapan government following a Cabinet meeting in April 2019, after it was decided that the development would have a positive impact on the economy and would help attract foreign investments into the country.
The first pile for the project is expected to kick off early next year for the first 20ha, which master developer IWH-CREC Sdn Bhd is targeting to finish in four years.
IWH-CREC is the joint-venture company of Iskandar Waterfront Holdings Sdn Bhd (IWH) – a private vehicle of tycoon Tan Sri Lim Kang Hoo – and China Railway Engineering Corp (M) Sdn Bhd (CREC).
IWH-CREC owns a majority 60% stake in Bandar Malaysia, while the Finance Ministry holds the remaining 40%.
The project is ready to start early next year, after the settlement on Tuesday of a RM1.24bil payment to the Federal Government by IWH-CREC.
The development, in fact, had been initially expected to kick-off in March but was delayed by the pandemic.
To help sell the land, a slew of tailored incentives for investors will be rolled out based on the types of industries and businesses that need to be attracted to the massive development.
Bandar Malaysia will be home to the Express Rail Link (ERL), KTM and Mass Rapid Transit (MRT) Line 2 and 3 as well as the existing ERL railway which connects the KL International Airport and KL Sentral transportation hub.
The MRT2 project, which is set to be completed by 2021, has already designated two stations at Bandar Malaysia. The Setiawangsa-Pantai Expressway (formerly known as DUKE 3), slated to be completed by 2021 and is linked to 12 other highways into KL city, will also be aligned to Bandar Malaysia.
To be developed over 20 years, Bandar Malaysia will shape the future direction of Kuala Lumpur by offering a new lifestyle city with modern infrastructure to become an iconic development within the Asean region.
According to the Bandar Malaysia website, a wide variety of offerings will be made available, ranging from luxury city homes, SoHos for entrepreneurs and affordable homes for growing families, all to be incorporated as part of the project’s master plan.
Source: The Star